Published 8:00 pm, Monday, April 7, 2003

Stamford, Conn.-based MeadWestvaco said it expects a first-quarter net loss of 36 cents to 41 cents a share.

The company said the outlook includes an accounting charge of 2 cents a share related to the adoption of accounting rules for asset-retirement obligations.

Analysts' latest estimate was for a loss of 8 cents a share, according to Thomson First Call, which excludes items in its forecasts.

In the same period a year ago, MeadWestvaco posted a loss of $63 million, or 37 cents a share, on sales of $1.46 billion. Excluding restructuring and other merger-related charges, the loss was $30 million, or 17 cents a share.

Besides higher costs, the company cited the weak economy and operating challenges at some of its paperboard mills for its weak quarterly guidance.

MeadWestvaco said the first quarter is a seasonally weak period for several of the company's businesses, particularly its consumer and office-products segment.

As a result, the company said it is cutting 2003 capital expenditures to about $400 million from $500 million.

On Monday, MeadWestvaco said it would close two folding carton plants, affecting about 455 employees. Its Richmond, Va., plant employs about 320 people, while its Cleveland, Tenn., plant has about 135 workers.

The plant closings will result in MeadWestvaco incurring a pretax charge of about $9 million in the first quarter for employee restructuring benefits and asset writedowns.

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The company, formed by the January 2002 merger of Mead Corp. and WestVaco Corp., also said it is confident it can achieve $360 million in merger-related synergies this year.

Shares of MeadWestvaco closed Tuesday at $22.87, down 63 cents, or 2.7 percent, on the New York Stock Exchange.